Title:
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Environmental regulation : choice of instruments under imperfect compliance
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Author:
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Macho Stadler, Inés; Universitat Autònoma de Barcelona. Unitat de Fonaments de l'Anàlisi Econòmica; Institut d'Anàlisi Econòmica
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Abstract:
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This paper originated from the AEE/REE presidential address for the XXX Simposio de Análisis Económico (Murcia 2005). It builds on the research project on optimal enforcement in environmental problems done in collaboration with David Pérez-Castrillo. I would like to thank David Pérez-Castrillo and Pau Olivella for their useful comments. I gratefully acknowledge the financial support from the Ministerio de Ciencia y Tecnología (BEC2003-01132) and the Generalitat de Catalunya (Barcelona Economics - CREA and 2005SGR-00836). |
Abstract:
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Compliance is an important issue in environmental regulation. In this paper, we discuss some of the key elements of the problem and analyze a situation where emissions are not random and firms are risk-neutral. We study the firm's decision on emissions and compliance when the environmental regulation is based on standards and the enforcement agency audits the firm with a certain probability. We then compare total emissions when environmental regulation is based on different instruments: standards, taxes, and tradable permits. We show that when compliance is an issue, environmental taxes are superior to the other instruments. We also analyze the (static) efficiency of the solution. |
Subject(s):
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-Política del medi ambient -Environmental regulation -Audits and compliance -Environmental instruments |
Rights:
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open access
Aquest document està subjecte a una llicència d'ús de Creative Commons, amb la qual es permet copiar, distribuir i comunicar públicament l'obra sempre que se'n citin l'autor original, la universitat, la unitat i l'institut i no se'n faci cap ús comercial ni obra derivada, tal com queda estipulat en la llicència d'ús
https://creativecommons.org/licenses/by-nc-nd/2.5/ |
Document type:
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Working paper |
Published by:
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Share:
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Uri:
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https://ddd.uab.cat/record/45266
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